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Blackstone Inc. acquired 20% of the outstanding common stock of Hansen Inc. on December 21, 2015. The purchase price was $1,250,000 for 50,000...
Blackstone Inc. acquired 20% of the outstanding common stock of Hansen Inc. on December 21, 2015. The purchase price was $1,250,000 for 50,000 shares. Hansen Inc. declared and paid an $0.80 per share cash dividend on June 30 and on December 31, 2015 Hansen Inc. reported net income of $730,000 for 2016. The fair value of Hansen Inc.'s stock was $27 per share at December 31, 2016.
Prepare the journal entries for Blackstone Inc. for 2015 and 2016, assuming that Blackstone cannot exercise significant influence over Hansen Inc. The securities should be classified as available-for-sale.
